On Friday, American Electric Power (AEP), Public Utilities Commission of Ohio (PUCO) staff, the Sierra Club and other stakeholders reached a settlement agreement for AEP Ohio to develop 900 MW of renewable energy, initiate an electric vehicle (EV) program and protect consumers from monthly fixed-fee rate increases.
AEP Ohio – an AEP unit delivering electricity to nearly 1.5 million customers of AEP subsidiary Ohio Power Co. – says it filed the settlement with PUCO to address its Electric Security Plan (ESP). The agreement addresses key elements of the ESP, such as EV charging, renewable generation and distribution grid reliability through 2024.
According to the utility, the agreement furthers its ability to participate in the development of wind and solar generation in the state through the creation of a renewable generation rider. The settlement also establishes an option for AEP Ohio to seek approval for a renewable project under which some or all of the project’s output would be purchased through a bilateral contract with a retail customer. All projects would be subject to commission approval, AEP Ohio notes.
The company says it will also be able to invest in infrastructure projects, such as upgrading the electric distribution grid, to enhance reliability for customers. Additionally, the settlement allows AEP Ohio to develop pilot programs for EV charging station development and microgrids, funded by a new charge that will end after the demonstration projects are completed in four years. The pilot programs are expected to provide data and insights for AEP Ohio, the PUCO and others interested in expanding these technologies throughout the state, the utility says.
According to the Sierra Club, the agreement adds flexibility to the cost-recovery methods that will be used to develop new clean energy projects – which furthers the Sierra Club’s vision of creating a renewable energy manufacturing hub in Appalachian Ohio. The group notes that AEP Ohio will develop the microgrid demonstration projects in areas where critical public service facilities – such as police and fire stations, hospitals and emergency shelters – could benefit in the event of a power outage.
In addition, the group says AEP dropped its request for a new rate design that would have increased fixed customer charges by $10/month (according to the original application).
The settlement agreement, which still requires final PUCO approval, was supported by a broad set of stakeholders, including commission staff and environmental, consumer, renewable energy and large-customer interests, says the Sierra Club.
AEP Ohio notes that the stipulation is also subject to review and modification by the PUCO; a procedural timeline has not been announced.
“AEP’s customers have been demanding clean energy for years,” states Daniel Sawmiller, senior campaign representative for the Sierra Club’s Beyond Coal Campaign. “Our vision in these settlement agreements has been to attract clean energy investments into Ohio’s Appalachian communities at sufficient scale to appeal to job-creating manufacturers in the solar supply chain. Ohio has relied on the families in Appalachia for power production for decades. Now, with high unemployment rates and other problems facing Appalachian Ohio, we’re glad to be one step closer to bringing new clean energy jobs to the region.”